Canadians Eye the U.S. For Cheaper Houses

Canadians outnumbered every other foreign demographic of homebuyers in the U.S. over the past year, though overall investment stateside is down.

By Josh Sherman | 3 minute read

Florida is the number one destination for Canadians purchasing homes in the U.S.

House hunters from the Great White North are now the top foreign homebuyers in the U.S., surpassing their peers from China this year, American realtors say.

Between April and March 2024, 13% of foreign buyers in the U.S. were Canadians — the most of any international cohort — according to real estate industry group the National Association of REALTORS® (NAR). Chinese and Mexican nationals, the other main buyers, each accounted for an 11% share of transactions.

The findings are from NAR’s latest annual report on foreign buyers and based on a survey of 17,060 U.S.-based Realtors. NAR defines foreign buyers as those who primarily live outside the country or recent non-citizen immigrants or visa holders.

Overall, foreign buyers purchased 54,300 homes of all types last year, or 1.3% of all existing-home sales. That’s down sharply from the 84,600 homes foreign buyers purchased the previous year. NAR notes that poor exchange rates for Canadian and Chinese buyers were headwinds for foreign investment in U.S. real estate. Last year, NAR found buyers from Canada were involved in 10% of sales involving foreign buyers, trailing China (13%) and Mexico (11%). 

Although Canadians overtook Chinese buyers this year for the top spot, they still spent less than them, shelling out a total of $5.9 billion in US dollars on homes. Chinese buyers snapped up $5.9 billion worth of property. That’s because although Canadians purchased more, Chinese buyers tended to purchase more expensive properties.

Canadian foreign buyers paid an average of $834,000 on their new American abodes. While that outpaces the national average — which stood at $501,700 as of this year’s second quarter, according to the Federal Reserve Bank of St. Louis — it pales in comparison to what Chinese buyers were typically forking over.

“Chinese buyers continue to have the highest average purchase price at $1.3 million, as buyers purchased in expensive states,” according to NAR’s 2024 International Transactions in U.S. Residential Real Estate report.

Where (and Why) Are Canadians Buying U.S. Real Estate?

Lately, most Canadian foreign buyers have been buying homes in Florida (41%), or Arizona (23%), with Hawaii also a relatively popular locale (9%). These sunny destinations align with Canadians’ plans for recreation rather than relocation. 

In fact, 37% of Canadian foreign buyers purchased in places NAR refers to as “resort areas.” Meanwhile, nearly half (49%) of recent Canadian foreign buyers plan to use their purchase as a vacation home, while another 22% cited “vacation and rental” as their motivation, according to the NAR survey.

For 16% of Canadians, the home will be their primary residence, making it the third-most-common intended use and unchanged from last year.

Relative affordability — particularly in the single-family home segment — is partly contributing to demand from up north, suggests an RBC report on the survey results. The “U.S. remains more affordable despite rising prices and depreciating foreign currency,” according to the report, noting that the “affordability of U.S. single-family homes helped to offset the cost to buy for many foreign buyers.”

For example, NAR pegs the median cost per square metre for a single-family home in Toronto at $12,504, far below pricing in the Miami metro area ($3,620).

The NAR report cites a couple of other factors that have helped offset rising costs related to higher interest rates and a weaker Canadian dollar: “[S]tock market and wealth gains have allowed foreign buyers to spend in the U.S. where single-family home prices remain affordable compared to the cost of a property in a central business district in many other countries.”